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Technology Stocks : America On-Line (AOL) -- Ignore unavailable to you. Want to Upgrade?

To: LindyBill who wrote (872)	1/2/1999 9:51:00 AM
From: Brian K Crawford	Read Replies (1) \| Respond to of 41369

<< I would like to know if they are still capitalizing their subscriber acquisition cost, this could bite them in the butt some day. >> LindyBill, AOL stopped capitalizing member acquisition costs, and wrote off all the prior accumulated costs. I believe it was in 1996. Steve Case announced the change under a lot of financial media pressure, and called AOL's new approach "Gold Standard" accounting. They now expense all marketing and member acquisition costs as incurred. It seemed to satisfy the critics at the time. At the time of the write-off, the bears on the stock had a field day, pointing out that after taking the write-off AOL's retained earnings were totally wiped out, thus AOL "had not managed in its entire history to make a profit". Art Stone is a name from the past that used to like to bang away at that issue, as I recall. This board had a very different tone back then, as evidenced by the title of the prior thread ..."will it survive?" I see by Art's price forecast he hasn't changed his position: 287 at 1/31/99 and 37 at January 2000. That's a Big Bear! He is consistent, I will give him that... Best wishes to all in 1999. Especially Steve Case and Bob Pittman. Brian